Making a good appointment of a distributor or agent in an overseas territory is crucial, since on it depends the development of successful, sustainable business. If you get it wrong, valuable time, funds and perhaps credibility will be lost.
Basic information should be gathered which includes:
- Name of Business and Contact details
- Number of staff
- Territories covered
- Categories handled
- Lists currently carried
- Commission rates
- Promotion capacity and any costs associated
- Commission rates and terms
- Travel schedule and call cycle (per year)
- Distribution capability (and if yes, discounts, payment terms, returns, credit control)
Among the questions to be asked (which will involve research with other parties in the territory and with the potential partner’s existing suppliers or principals) are:
- Do I get a good feeling from my interaction with this person or company? Do I sense that I can work with them and enjoy doing so (the latter is important)? Do they give me a sense of honesty, transparency and straightforwardness? Will this be a relationship for the long term? (Typically, the initial term of agreement will be not less than two years, with mutually agreed renewal or notice of termination. Any shorter period does not provide an opportunity to explore the list’s potential and establish it.)
- How long has this distributor or agent been operating? What is their reputation in the territory and with other principals? Might I in this case benefit from someone fresh and focused, even if they are less established than others?
- Will this distributor offer the level of stockholding the market might require? Do the requested pricing and other terms of supply work for me as well as for the marketplace? Above all, is this distributor, or are the customers an agent will ask me to supply, good paymasters? (However effective a distributor or agent may be, it is all in vain if you will not be paid. Informal checks as well as credit agency reports are helpful here.)
- What are the resources of the company or person? Do they have the personnel, expertise, and processes in terms of sales, marketing and logistics to allow them to fulfil what I am seeking? Do they have the right connections, customer base and influence in the market? Do they make effective contact with decision-makers in the market? Are they equipped to provide services (if I require them) beyond the supply of materials, such as events and workshops?
- Does this person or company demonstrate an understanding of the market in which they operate, of my product and of how it might fit the market? Will they improve my own understanding of that market and thus of the product required?
- Is this person or company publishing so many books of their own, or carrying so many third-party agencies, that mine will struggle to gain attention within their portfolio? On the other hand, is their portfolio too small to gain attention in the market? (One is seeking the sweet spot where the distributor or agent is large enough to gain market access but not so large that one’s list will be buried within the product range.)
- What is the product context into which my list will fall, whether a distributor’s own publications (in the case of a publisher/distributor) or other distributed lists, or both? The same principle applies to an agent. A list can complement another by being different and non-competitive or supplement an offering in a particular area to make it stronger. This subject should be addressed explicitly with the potential partner.
- In the case of a distributor, does this company have an existing supply line into which I can viably and cost-effectively fit? If not, will it be possible to set one up which works for us both?
- In the case of an agent, am I confident that I will be able to supply viably the orders they procure from the customers in the territory?
- Is this company or person operating the right level of technology, including databases and Customer Relationship Management, to be able to communicate effectively with principals and customers, to carry out the functions I require, and to make full use of the appropriate marketing materials I provide? What do their website and other digital assets reveal about this capability?
- Will this potential partner play a role in copyright protection should that be needed?
- Looking at this possible partnership from the other party’s point of view, is what I am offering of sufficient interest and substance to warrant their entering into an agreement with me?
